Unlock the Ways to Enter the $100B Vacation Rental Market

Last Updated on April 12, 2025

Imagine turning weekend getaways, cozy cabins, and scenic stays into a billion-dollar opportunity. Sounds unreal, right? But that’s exactly what the vacation rental market is offering right now—a $100B+ playground just waiting for fresh, disruptive ideas. And guess what? It’s Gen Z that’s perfectly positioned to lead the charge. You’re not just digital natives—you’re creators, community builders, and trendsetters who understand what modern travelers actually want. 

Whether it’s exploring Bali on a budget or booking a treehouse in Tulum, today’s travelers crave authentic, local, and Insta-worthy experiences. That means there’s never been a better time to build a platform that speaks their language. So, if you’ve ever thought about launching your own vacation rental app like Airbnb—but cooler and more community-driven—this guide is for you. 

Let’s break down exactly how you can enter this booming market and build something unforgettable. Ready? Let’s dive in.

Understanding the Rise of the Vacation Rental Economy

The global vacation rental market has surged over the past decade, becoming a $100 billion industry as of 2023, according to Statista. Platforms like Airbnb, Vrbo, and Booking.com have revolutionized the way people travel, shifting demand away from traditional hotels toward more personalized, unique, and affordable accommodation options. What began as a niche market appealing to backpackers and digital nomads has evolved into a mainstream choice for families, business travelers, and even luxury vacationers.

This growth is powered by several macro trends, including the increased preference for remote work and extended stays, the rising costs of hotel accommodations, and a broader cultural shift toward experiential travel. Travelers today want to live like locals, not tourists—and vacation rentals offer exactly that. Furthermore, the rise of platforms like Airbnb has lowered the barrier to entry for homeowners and property investors, creating an ecosystem where supply is growing almost as fast as demand.

For Gen Z entrepreneurs, this presents a once-in-a-generation opportunity. Unlike previous generations, Gen Z has grown up entirely in a digital world, making them uniquely equipped to build tech platforms and brands that appeal to their peers. Their fluency in digital tools, combined with their strong social values and affinity for community-driven models, makes them perfect candidates to disrupt the already booming vacation rental space with something more targeted, values-driven, and innovative.

Gen Z: Shaping the Future of Travel

Gen Z travelers, defined as those born between 1997 and 2012, now represent a growing slice of global travel spending. According to a 2023 Expedia survey, 74% of Gen Z travelers prioritize “authentic local experiences” over traditional tourist attractions, and 60% prefer vacation rentals over hotels. Their values lean toward sustainability, community, digital-first convenience, and customizable experiences. These preferences are not just shaping demand—they’re setting new standards for the vacation rental market.

Gen Z is also redefining the concept of travel itself. With remote and hybrid work now widely accepted, “bleisure” travel—mixing business and leisure—is on the rise. Many Gen Z professionals are opting for month-long stays in culturally rich locations, effectively blending work with immersive experiences. Vacation rentals that offer strong Wi-Fi, work-friendly environments, and flexible check-ins are now more appealing than luxury hotels with conference centers.

This trend is even more powerful because Gen Z doesn’t just want to consume travel—they want to influence it. The rise of the creator economy means that Gen Z travelers document their stays, share them on platforms like TikTok, and influence others through authentic content. A vacation rental isn’t just a stay—it’s content, clout, and community. Any new app or marketplace that empowers Gen Z to travel and share their journey is positioned to win their loyalty and viral traction.

Strategies to enter the $100B Vacation Rental App

Opportunities in a Saturated Yet Fragmented Market

At first glance, the vacation rental market might look saturated. Major players like Airbnb, Vrbo, and Booking.com dominate headlines and mobile screens. However, the reality beneath the surface tells a different story—this ecosystem is fragmented, full of gaps, underserved regions, and untapped niches that offer ripe opportunities for Gen Z entrepreneurs to build something disruptive and highly profitable. Let’s break down some of the most promising areas where new players can win big.

Regional Targeting in Underserved Markets

While North America and parts of Europe are heavily saturated with vacation rental platforms, huge swaths of the global travel map remain underserved. Countries across South Asia, Africa, and Latin America are seeing spikes in tourism, but travelers there often face poor booking experiences, lack of inventory, and limited local-language support.

Take Indonesia, for instance. In 2023, it welcomed over 10 million international tourists, becoming a hotspot for digital nomads and eco-tourists alike. Despite this boom, vacation rental platforms remain limited in Bahasa Indonesia and rarely offer localized features like regional payment methods or cultural etiquette tips. This is a massive opportunity for a localized platform that integrates with local banking apps, includes multilingual support, and reflects the norms and expectations of Indonesian travelers and hosts. By building culturally aware, region-specific solutions, you can enter these markets with minimal competition and maximum growth potential.

Also read: Top Monetization Strategies for Your Vacation Rental App

Niche and Lifestyle-Based Vacation Rental Platforms

Not every traveler wants a generic stay. More and more people—especially Gen Z—are looking for accommodations that align with their identities, values, and lifestyles. That’s where thematic or lifestyle-focused rental platforms come into play. These apps don’t try to be everything to everyone; instead, they go deep on one niche and create a tailored experience that users can’t find elsewhere.

For example, Plum Guide targets luxury travelers looking for only the best homes, verified by a rigorous quality standard. Misterb&b caters to LGBTQ+ travelers, creating a community of safe and welcoming stays. These platforms thrive not because of their size, but because of their focus. And yet, there are countless niches still left unexplored. Think pet-friendly retreats, wellness-focused eco-resorts, digital nomad-specific listings, or even faith-based vacation rentals. With the right tech and community-building strategy, a niche-focused app can build deep loyalty and strong user retention—something generalist platforms struggle with.

Solving the Quality and Trust Gap

Even Airbnb, the market leader, continues to struggle with quality control and inconsistent host experiences. Bad reviews, last-minute cancellations, and misleading photos are still common pain points. This opens the door for startups that focus on verified stays, curated experiences, and a higher standard of trust.

A platform that prioritizes quality assurance—by conducting digital or in-person inspections, enforcing listing standards, or offering a “Verified Stay” badge—could attract premium travelers willing to pay more for peace of mind. Combining that with robust customer support and clear cancellation policies creates a major trust advantage that sets your platform apart.

Also read: How to Start a Successful Vacation Rental Business in 2025

Designing a Vacation Rental App for Gen Z Users

For Gen Z, design is more than aesthetics—it’s an expectation of fluid, fast, intuitive digital experiences. They’re not impressed by clunky UX, outdated designs, or endless forms. Instead, they expect mobile-first apps with minimalist interfaces, smart recommendations, and immediate gratification. Your vacation rental app should reflect these priorities from its first screen.

Start with a fast, frictionless onboarding process using social logins like Google, Apple ID, or even TikTok. Incorporate swipeable discovery interfaces akin to dating apps, allowing users to explore properties based on mood, vibe, or activities rather than static filters. Implement features like real-time chat with hosts, one-tap payments, saved wishlists, and digital key access for seamless travel.

Incorporating user-generated content can dramatically improve engagement. Let users upload photos or video reviews of their stays, not just star ratings. Introduce travel timelines or short reels that document their journeys, which can then be shared within the app or externally. This transforms your platform into a hybrid of a booking tool and a social feed, increasing time spent in the app and building community.

Gamification also works well with Gen Z. Offer travel badges, reward points, social leaderboards, or streaks for reviewing properties and completing bookings. Personalization should be built into every layer—suggest destinations based on users’ past trips, content they engage with, and travel aspirations they indicate during onboarding.

Also read: How to Build Trust for Your Vacation Rental App like Airbnb

How to Acquire Supply: Building Host Communities

Every successful vacation rental platform must solve the chicken-and-egg problem of supply and demand. At launch, you need a critical mass of listings in your target area—but how do you attract hosts when no one’s booking yet? The answer lies in incentives, education, and tech empowerment.

Early-stage host acquisition requires trust-building. Offer zero or reduced commission for the first few months, and provide high-quality onboarding assistance. For example, include professional photography, property staging advice, and SEO-optimized listing templates as part of your host onboarding package. This is how Airbnb gained traction in New York and San Francisco during its early days—by personally onboarding hosts and helping them optimize their listings.

Empower hosts with smart tools. A mobile dashboard with calendar syncing, dynamic pricing suggestions, earnings projections, and real-time communication helps reduce friction. Offer integrations with smart home devices, automated guest check-in instructions, and multilingual guest messaging tools to create a competitive edge.

Host communities are another powerful tool. Build online groups or forums where hosts can connect, share tips, and suggest platform improvements. Highlight top hosts through spotlight stories, give them featured badges, or invite them to advisory councils. When hosts feel like they’re part of a movement—not just a revenue source—they become brand evangelists.

Also read: Top Vacation Rental Apps Like Airbnb in the USA

Differentiating with Smart Tech: AI, ML, and Automation

Tech differentiation is one of the most powerful ways to stand out in the vacation rental space. Artificial Intelligence (AI) and Machine Learning (ML) can transform your app into a smarter, more adaptive travel companion. Platforms like Airbnb are already leveraging AI to make listing recommendations, price adjustments, and fraud detection—but these tools are still evolving.

For your platform, start by using ML to personalize the discovery process. Analyze user behavior and tailor results based on location history, preferences, travel dates, and even mood. For example, if a user often clicks on cozy cabins in nature, the algorithm should push similar listings in new locations.

AI-powered chatbots can enhance customer service, handling everything from booking inquiries to trip modifications and complaints. Tools like GPT-4 (yes, even us!) can be fine-tuned to act as virtual travel concierges that recommend activities, dining options, or even help resolve conflicts between hosts and guests.

Automated fraud detection is also critical. Use AI to flag suspicious user activity, duplicate listings, or reviews that appear fake. As trust is paramount in travel marketplaces, building these systems in early will save your brand in the long run. Automation in pricing, availability syncing, and reviews also improves efficiency and scalability, enabling your team to focus on strategic growth.

Marketing a Vacation Rental Platform in the Age of TikTok

Traditional ads won’t cut it with Gen Z. To build buzz around your vacation rental app, focus on social-first, content-driven campaigns that tap into creators and cultural trends. According to a report by Influencer Marketing Hub, 84% of Gen Z travelers discover travel destinations via social media, with TikTok and Instagram leading the pack.

Influencer partnerships are essential, but relevance trumps reach. Partner with micro-creators in the travel, sustainability, or digital nomad niches who can produce authentic stay reviews, local experiences, and tutorials on how to use your app. Offer free stays or experiences in exchange for high-quality, organic content.

Your content marketing should center on emotion and aspiration. Create short-form videos that showcase dream stays, hidden gems, and “day in the life” vlogs of travelers using your app. Use storytelling to highlight your mission, values, and community. Launch campaigns that invite users to share their own travel stories, participate in challenges, or unlock achievements through in-app actions.

Referral programs, viral features like shared wishlists or group planning tools, and gamified travel credits can turn early adopters into brand ambassadors. With Gen Z, the line between user and marketer is blurred. The more shareable your app becomes, the faster it grows.

Sustainable Monetization That Aligns With Gen Z Ethics

Monetization is critical to the success of any vacation rental platform, but for Gen Z audiences, the traditional “extract as much value as possible” model just won’t fly. This generation demands transparency, fairness, and a strong alignment with ethical values. If your app is perceived as greedy, misleading, or exploitative, you’ll quickly lose trust—and trust is everything in this market. Below are several monetization strategies that not only drive revenue but also strengthen brand loyalty and community credibility.

Use Transparent Commission Models

The most common monetization model in the vacation rental industry is a commission on bookings—typically between 10% to 20%. This model is tried and tested, but it must be handled with care when targeting Gen Z. Be crystal clear about how much is charged to hosts and guests, and explain where that money goes. Is it reinvested into app development, trust and safety, or 24/7 customer support? Say so.

Fairness also matters. Don’t burden one side of the transaction with all the fees. A transparent, balanced approach—such as splitting the commission between guest and host—feels more equitable. Consider adding a visual breakdown during checkout to show users exactly what they’re paying for. Gen Z values honesty over hidden fees, and when you show them the reasoning, they’ll often support the cost.

Offer Host Subscriptions with Added Value

Rather than charging hosts per booking, you can give them the option of a monthly or yearly subscription plan that unlocks premium features. This not only ensures recurring revenue for your platform but also provides real value for hosts looking to grow.

Features could include advanced analytics dashboards that help hosts track performance, dynamic pricing tools, promotional listing boosts, early access to bookings, or priority customer support. You can even include education resources—like best practices for hospitality or legal compliance—as a perk. Think of this like a “Pro” account for serious hosts who want to run their properties like a business. Subscription-based monetization feels more predictable and less transactional, which many Gen Z hosts will appreciate.

Upsell Ethical and Experience-Driven Add-ons

Gen Z is willing to spend money, but only when it aligns with their values or enhances their experiences. Instead of pushing pointless add-ons or upselling aggressively, focus on meaningful enhancements. For example, offer optional carbon offsets at checkout to appeal to eco-conscious travelers. Curated experience bundles—such as local tours, sustainable transportation, or homecooked meals—can also be monetized in a way that adds value and authenticity.

You can even create a “Verified Stay” badge that travelers pay extra for, indicating a vetted host or a professionally inspected property. These kinds of features support safer and more enjoyable travel, making them feel like upgrades rather than upcharges.

Also read: Common Vacation Rental Challenges Every Aspiring Entrepreneur Should Know

Monetize Through Local Partnerships

Another ethical and effective strategy is monetizing through affiliate partnerships with local businesses. Your app can feature curated local experiences like guided hikes, boat rides, art classes, or farm-to-table dinners—and earn a commission on every booking made through your platform. This not only supports the local economy but enriches the travel experience.

Because Gen Z travelers love discovering offbeat and community-driven experiences, these affiliate options can actually become part of the platform’s appeal, giving you both content and cash flow.

Be Transparent About Data Usage

In a world where digital platforms often exploit user data, your app can stand out by doing the opposite. Offer users opt-in personalization and explain exactly what data you collect, how you use it, and—most importantly—what you don’t do with it. Make a public commitment not to sell user data to third parties and display that promise prominently in your app.

Transparency builds trust, and trust is monetizable. Users who feel safe on your platform are more likely to complete bookings, refer friends, and stick around. Ethical data practices may not directly generate revenue, but they create the long-term loyalty needed to sustain a profitable platform.

Navigating Legalities, Regulations, and Community Impact

Vacation rentals are subject to a patchwork of local laws, taxes, and zoning restrictions that vary by city and country. Failure to comply can result in penalties, blacklisting, or even legal action. As a founder, you must incorporate legal intelligence into your platform from the beginning.

Provide resources to hosts on how to obtain permits, collect taxes, and understand occupancy rules. Automate license expiration reminders and city-specific checklists. Build tools that help users understand local rules during booking, such as minimum stay requirements or quiet hours in residential neighborhoods.

Additionally, consider your app’s impact on housing availability and local culture. Many cities have pushed back against short-term rentals for inflating housing prices and disrupting communities. You can respond by encouraging longer-term stays, offering options for affordable housing co-ops, or reinvesting a portion of profits into local housing initiatives.

Be proactive in your ethics and regulation messaging. Transparency in how you engage with local governments, housing advocates, and city planners will enhance your credibility and future-proof your brand.

Also read: Guide to Start a Car Rental Business – All You Need to Know

Launch Your own Vacation Rental Platform like Airbnb

Ready to build the next Airbnb? Launch your own vacation rental platform like Airbnb with Oyelabs and tap into the booming $100B+ market. Whether you’re targeting niche audiences, underserved regions, or looking to create a sleek, Gen Z-friendly booking experience—we’ve got you covered. From scalable backend systems to beautiful user interfaces and robust security features, Oyelabs helps you bring your idea to life with speed and precision. Don’t just watch the travel revolution—lead it. Partner with Oyelabs today and turn your vision into the next big thing in vacation rentals. Let’s build something unforgettable, together.

Conclusion: Your Window into a Billion-Dollar Industry

The vacation rental market is no longer just an Airbnb story—it’s a sprawling, dynamic landscape filled with micro-markets, untapped niches, and values-driven users looking for better experiences. For Gen Z entrepreneurs, the moment to enter is now. The combination of technological fluency, cultural alignment, and digital creativity gives you the tools to build a vacation rental app that’s more than just another marketplace—it can be a movement.

From eco-retreats and creator havens to inclusive getaways and remote work-friendly destinations, the world is waiting for the next big platform that puts experience, community, and purpose first.

At Oyelabs, we specialize in building apps that disrupt industries—apps that speak Gen Z’s language, use cutting-edge tech, and scale beautifully. Whether you’re building a micro-niche rental marketplace or an AI-powered travel companion, we bring your boldest ideas to life with end-to-end development and strategic expertise.

Ready to launch the next big thing in travel? Let’s build it together. Contact Oyelabs today.